I am the India Editor of Forbes Asia and Mumbai bureau manager of Forbes. Earlier, I was managing editor of Business India, among India's leading business magazines. I'm also a founding director of SatyaGyan Foundation, a non-profit that aims to alleviate poverty through education and employment.

Ironically, this ‘downgrade’ follows what was a rather decent quarter for Reliance which reported a tidy rise of 17% in net profit to $1.3 billion, its highest ever, as of June 30. But analysts say that Reliance has lately been hit by a lack of investor confidence. “ People no longer believe it’s a growth stock, “ says a Mumbai investment banker.

Coal India, the nation’s largest coal producer, by comparison, is enjoying a good run as expansion in the power sector fuels demand for coal. Since its IPO last October, Coal India’s stock price has gained 62% in a period when the benchmark Sensex itself has lost 19%. Earlier this month, the miner was included among the 30 key stocks that comprise the Sensex. Reliance Infrastructure and Reliance Communications, controlled by Mukesh’s younger sibling Anil, were dropped from the benchmark index.

Mukesh’s Reliance has performed worse than the market during that same period, losing nearly a third of its market cap. In February, it inked a $7.2 billion deal with BP which bought a 30% share in 23 oil and gas blocks operated by Reliance in India. The deal was expected to boost Reliance’s languishing stock price but that hope has been belied. Reliance’s shares are currently at 755 rupees, down from 1,105 rupees last November when Coal India listed.

“ Reliance will have to devise a strategy to jump-start growth, “ said Vimal Bhandari, chief executive of Indostar Capital, a Mumbai finance firm. If not, Mukesh Ambani’s status as India’s richest resident could also be in jeopardy.

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